OSLO (Reuters) - Norwegian oil and gas group StatoilHydro
said it was ready to work with new Canadian rules on carbon
dioxide emissions at its planned oil sands venture in Alberta.

"We have known for a long time that something on CO2 would
come from the Canadian authorities and we think we are well
prepared," spokeswoman Kjersti Morstoel said on Wednesday.

She said StatoilHydro, which last year bought 257,000 acres
of oil sand leases in Alberta's Athabasca region for about $2
billion, still needed to evaluate the details in the new rules.

According to new regulations, oil sands facilities that go
into operation starting from 2012 will be required to capture
and store the bulk of their emissions of carbon dioxide, which
is blamed for climate change.

ADVERTISEMENT

Existing facilities -- which process the tar-like bitumen
from Alberta's massive oil sands into refinery-ready light
crude -- and those that start operating before the end of 2011
will have to reduce emissions using cleaner fuels according to
the rules that will be finalized next year.

StatoilHydro is due to have its 10,000 barrels of bitumen
per day demonstration project up in late 2009 or early 2010.

Its oil sands portfolio is expected to yield more than
200,000 barrels per day by the end of the next decade, if it
follows through with an upgrader facility.

"According to our project, we have not yet decided on the
upgrader. But the upgrader is designed to be carbon capture
ready from day one," Morstoel said, adding that it was not yet
clear when StatoilHydro would make a decision on the upgrader.